A class of more than 220,000 retired North Carolina state workers will get another chance to argue that a 2011 law changing their health coverage unconstitutionally violated their vested rights, according to a ruling by the state’s highest court.
The retirees have a vested right to lifetime enrollment in a premium-free health plan providing coverage that’s of “equivalent or greater value” than the plan offered at the time they became eligible to enroll, the Supreme Court of North Carolina held March 11. This benefit, which the state offered to retirees in exchange for their continued employment, was an “important component of the state employees’ acceptance of and continuation in employment with the State,” the court said, reversing a lower appellate court.
Even so, the retirees can’t win their lawsuit without showing that the change infringed on their vested rights by substantially reducing the value of the benefits they received, the court said. They also must show that any such reduction wasn’t “reasonable and necessary” to address a legitimate public purpose, the court said.
These questions involve disputed issues of fact that must be reconsidered by the lower court on remand, the Supreme Court said.
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